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Samtex Fashions Ltd.

BSE: 521206 Sector: Industrials
NSE: N.A. ISIN Code: INE931D01020
BSE LIVE 15:29 | 11 Dec 5.90 -0.23
(-3.75%)
OPEN

6.30

HIGH

6.30

LOW

5.85

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 6.30
PREVIOUS CLOSE 6.13
VOLUME 145333
52-Week high 14.79
52-Week low 3.24
P/E
Mkt Cap.(Rs cr) 44
Buy Price 5.89
Buy Qty 7780.00
Sell Price 5.90
Sell Qty 384.00
OPEN 6.30
CLOSE 6.13
VOLUME 145333
52-Week high 14.79
52-Week low 3.24
P/E
Mkt Cap.(Rs cr) 44
Buy Price 5.89
Buy Qty 7780.00
Sell Price 5.90
Sell Qty 384.00

Samtex Fashions Ltd. (SAMTEXFASHION) - Auditors Report

Company auditors report

TO THE MEMBERS OF

M/S SAMTEX FASHIONS LIMITED

We have audited the accompanying financial statements of M/s SAMTEX FASHIONS LIMITED("The Company") (Financial statements of trading office of the company atNew York are duly audited by R. Rehani & Co. Certified Public Accountants P.C. NewYork) which comprise the Balance Sheet as at March 31 2016 and the Statement of Profitand Loss and the Cash Flow Statement for the year then ended and a summary of significantaccounting policies and other explanatory information.

MANAGEMENT RESPONSIBILITY:

The Company’s Board of Directors is responsible for the matters in section 134(5)of the Companies Act 2013 ("the Act") with respect to the preparation of thesefinancial statements that give a true and fair view of the financial position financialperformance and cash fiows of the company in accordance with the accounting principlesgenerally accepted in India including the Accounting Standards specified under Section133 of the Act read with Rule 7 of the Companies (Accounts) Rules 2014.

This responsibility also includes the maintenance of adequate accounting records inaccordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting the frauds and other irregularities selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of internal financialcontrol that were operating effectively for ensuring the accuracy and completeness of theaccounting records relevant to the preparation and presentation of the financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

AUDITOR’S RESPONSIBILITY:

Our responsibility is to express an opinion on these standalone financial statementsbased on our audit. We have taken into account the provisions of the Act the accountingand auditing standards and matters which are required to be included in the audit reportunder the provisions of the Act and the Rules made there under. We conducted our audit inaccordance with the Standards on Auditing specified under section 143(10) of the Act.Those standards require that we comply with ethical requirements and plan and perform theaudit to obtain reasonable assurance about whether the financial statements are free frommaterial misstatement.

An audit involves performing procedures to obtain evidence about the amounts anddisclosures in the financial statements. The procedures selected depend on theauditor’s judgment including the assessment of the risks of material misstatement ofthe financial statements whether due to fraud or error. In making those risk assessmentsthe auditor considers internal control relevant to the company’s preparation and fairpresentation of the financial statements in order to design audit procedures that areappropriate in the circumstances. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of the accounting estimates made by themanagement as well as evaluating the overall presentation of the financial statements. Webelieve that the audit evidence we have obtained is sufficient and appropriate to providea basis for our audit opinion on the financial statements.

OPINION:

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone financial statements give the information requiredby the Act in the manner so required and give a true and fair view (subject to thematters of emphasis mentioned below) in conformity with the accounting principlesgenerally accepted in India; Subject to the above we report that the accounts representtrue and fair view:

a) In the case of the standalone Balance Sheet of the state of affairs of the Companyas at March 31 2016;

b) In the case of the Statement of Profit and Loss Account of the profit/ loss for theyear ended on that date; and

c) In the case of the Cash Flow Statement of the cash fiows for the year ended on thatdate.

EMPHASIS OF MATTERS

We draw attention to the following observation:

(a) Going concern concept of the company may be effected if the decision of the Boardof Director’s meeting held on May 28 2016 to stop the production activities of thecompany is implemented by the management.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS:

1. As required by the Companies (Auditor’s Report) Order 2016 ("theOrder") as required by Companies Act2013 and on the basis of such checks of thebooks and records of the Company as we considered appropriate and according to theinformation and explanations given to us we annex hereto a statement (Annexure – A)on the matters specified in said Order.

2. As required by section 143(3) of the Act we report that:

a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purpose of our audit.

b) In our opinion proper books of account as required by law have been kept by thecompany so far as appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss and the Cash Flow Statementdealt with by this report are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with theAccounting Standards speci-fied under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e) On the basis of written representations received from the directors as on 31 March2016 taken on record by the Board of Directors none of the directors is disqualified ason 31March 2016 from being appointed as a director in terms of Section 164(2) of theAct.

f) With respect to the adequacy of the internal financial control over financialreporting of the company and the operating effectiveness of such controls refer to ourseparate report in "Annexure B"; and

g) With respect to the other matters included in the Auditor’s Report inaccordance with rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its FINANCIALposition in its financial statements – Refer note 28 Part A to the financialstatements.

ii. The Company did not have any long term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There was not required to transfer amounts to the Investor Education andProtection FUND by the Company.

For AGGARWAL & RAMPAL
CHARTERED ACCOUNTANTS
FRN: 003072N
Sd/-
Praveen Kumar Rampal
PLACE : NEW DELHI Partner
DATE : May 28 2016 M.No.-82226

ANNEXURE - A TO THE AUDITORS’ REPORT

ANNEXURE REFERRED TO IN OUR AUDIT REPORT OF EVEN DATE OF M/S SAMTEX FASHIONS LIMITEDPURSUANT TO THE COMPANIES (AUDITORS’ REPORT) ORDER 2016 ON THE ACCOUNTS FOR THE YEARENDED MARCH 31 2016

i. (a) The Company has updated its records of fixed assets showing full particularsincluding quantitative details and situation of Fixed Assets.

(b) As explained to us most of the fixed assets have been physically verified by themanagement during the year and as per the explanations and information given to us thereis a regular program of verification which in our opinion is reasonable having regard tothe size of the company and the nature of its assets. As explained to us discrepanciesnoticed on physical verification were not significant and have been properly dealt with inthe books of accounts.

(c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties areheld in the name of the Company.

ii. According to the information and explanations given to us the inventory hasbeen physically verified during the year by the management but the Stock records wereunder updation. Accordingly they were not produced before us for verification and we haverelied upon the information provide to us by the management. Further as explained to usdiscrepancies noticed on physical verification were not significant and have been properlydealt with in the books of accounts.

iii. As explained to us the Company has not granted any loans secured orunsecured to companies firm Limited Liability Partnerships or other parties covered inthe Register maintained under section 189 of the Companies Act. 2013.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 with respect to the loansand investments made.

v. According to the information and explanations given to us the Company has notaccepted any deposit from the public.

vi. We have reviewed the cost records maintained by the Company pursuant to theCompanies (Cost Records and Audit) Rules 2014 prescribed by the Central Government underSection 148(1)(d) of the Companies Act 2013 and are of the opinion that prima facie theprescribed accounts and cost records have been maintained. We have however not made adetailed examination of the cost records with a view to determine whether they areaccurate or complete.

vii. (a) The Company is generally regular in depositing with appropriateauthorities undisputed statutory dues including income tax sales tax wealth taxService tax custom duty excise-duty cess Provident fund & ESI and other statutorydues applicable to it. According to the information and explanations given to us noundisputed amounts payable in respect of the aforesaid dues were outstanding as at March31 2016 for a period of more than six months from the date of becoming payable.

(b) According to information and explanation given to us the disputed statutory duesi.e. Income tax aggregating to Rs. 125.42 lakh that have not been provided for in thebooks of accounts on account of matters pending before concerned appellate authorities /Delhi High Court and ITAT Delhi bench. However a sum of Rs. 110.65 lakh is deposited underprotest against above demand. (Refer note no. 28 part A to notes to accounts)

viii. According to the information and explanations given to us the company has notdefaulted in repayment of dues to a financial institution or bank or debenture holders.

ix. The Company did not raise any money by way of initial public offer or furtherpublic offer (including debt instruments). And term loans raised during the year wereapplied for the purposes for which those are raised.

x. According to the information and explanations given to us no material fraud by theCompany or on the Company by its officers or employees has been noticed or reported duringthe course of our audit.

xi. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofsection 197 read with Schedule V to the Act.

xii. In our opinion and according to the information and explanations given to us theCompany is not a nidhi company. Accordingly paragraph 3(xii) of the Order is notapplicable.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

xiv. According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has not made any preferentialallotment or private placement of shares or fully or partly convertible debentures duringthe year.

xv. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

xvi. The Company is not required to be registered under section 45-IA of the ReserveBank of India Act 1934.

For AGGARWAL & RAMPAL
CHARTERED ACCOUNTANTS
FRN: 003072N
Sd/-
Praveen Kumar Rampal
PLACE : NEW DELHI Partner
DAT : May 28 2016 M.No.-82226

ANNEXURE - B TO THE AUDITORS’ REPORT

REPORT ON THE INTERNAL FINANCIAL CONTROLS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION143 OF THE COMPANIES ACT 2013 ("THE ACT")

We have audited the internal financial controls over financial reporting of SamtexFashions Limited ("the Company") as of 31 March 2016 in conjunction with ouraudit of the standalone financial statements of the Company for the year ended on thatdate.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reportingissued by the Institute of Chartered Accountants of India (‘ICAI’). Theseresponsibilities include the design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the orderly and efficientconduct of its business including adherence to company’s policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialinformation as required under the Companies Act 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the

Institute of Chartered Accountants of India. Those Standards and the Guidance Noterequire that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in allmaterial respects. Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls system over financial reporting and theiroperating effectiveness. Our audit of internal financial controls over financial reportingincluded obtaining an understanding of internal financial controls over financialreporting assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk.

The procedures selected depend on the auditor’s judgment including the assessmentof the risks of material misstatement of the financial statements whether due to fraud orerror. We believe that the audit evidence we have obtained is sufficient and appropriateto provide a basis for our audit opinion on the Company’s internal financial controlssystem over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company’s internal financial control over financial reporting is a processdesigned to provide reasonable assurance regarding the reliability of financial reportingand the preparation of financial statements for external purposes in accordance withgenerally accepted accounting principles. A company’s internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly refiect thetransactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with generally accepted accountingprinciples and that receipts and expenditures of the company are being made only inaccordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company’s assets that could havea material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion and according to the information and explanations given to us thecompany requires further improvement in internal financial control system to commensuratewith the size of company and the nature of its business.

For AGGARWAL & RAMPAL
CHARTERED ACCOUNTANTS
FRN: 003072N
Sd/-
Praveen Kumar Rampal
PLACE : NEW DELHI Partner
DAT : May 28 2016 M.No.-82226